Finding Text
Finding 2023-002 – SF-425 Financial Reporting
Criteria: The code of federal regulations requires that grantees submit accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements, set forth in § 200.328 and 200.329.
Questioned Costs: None
Condition: The City's internal controls over required reporting requirements were not accurately monitored and reviewed to prevent, or detect and correct the current year's actual federal spending.
Cause and Effect: The City transitioned into a city manager type of government during fiscal year 2023. In connection with the change in political term, a significant change in personnel occurred during the time of transition affecting the City's internal controls. As a result, expenditures reported in the SF-425 financial reports submitted were understated by a total of approximately $209,000.
Recommendation: We recommend that the City implement policies and procedures to ensure accurate reports are submitted to its respective agencies.
Management Response: The City agrees with the recommendation. Although inaccuracies are mostly due to change in personnel, management will make a greater effort to submit complete and accurate reports.